UBS Group AG (UBS)

A significant number of investors plan to vote tomorrow against UBS' (UBS) 2011 compensation plans. Advisory groups and institutional investors are upset by the lack of disclosure over how pay is calculated and the high proportion of variable pay. (earlier: UBS profit falls)

The biggest brokerages are targeting an ever-wealthier clientele to boost revenue and profitability, but a new study concludes a growing number of multi-millionaires are taking their money elsewhere. The share of high net worth customers' assets held by the top four brokers - MS, BAC, WFC and UBS - has dropped to 45% from 2007's 56% peak.

UBS joins 3 other strategic investors in raising $1.6B to buy a 16.5% stake in China Cinda Asset Management in advance of a future public offering of shares. The Chinese company is one of the asset managers set up by the government to remove bad loans from the nation's largest lenders.

UBS (UBS) reaches agreement in principle with a monoline insurer - believed to be MBIA (MBI+4.7%), although the name is not provided in the SEC filing - under which UBS agreed to the commutation of certain credit default swap contracts in exchange for a net cash payment.

Bank bonds are crushed in early trading, as the risk premium on intermediate term notes from Morgan Stanley, UBS and Goldman widen 0.14, 0.22, and 0.35 percentage points, respectively, and short-term paper from BofA and US Bancorp weaken 0.16 and 0.24 points. Their stocks are sinking too: MS-4.8%, UBS-3.9%, GS-3.8%, BAC-3%, USB-1.2%.

The Swiss government has passed a tax law that would allow it to hand over data on suspected U.S. tax evaders, even if U.S. authorities can't identify perceived offenders by name or bank account. The law, which helps support an expected settlement between the U.S. and Swiss banks over tax evasion, is seen as a weakening of the privacy safeguards Switzerland's finance industry has long been known for. (also)

Morgan Stanley sees the chance of multiple earnings upgrades for EU banks as the wave of liqudity from ECB's LTRO is stoking action. January was likely the best month for credit trading in 2 years, MS says, and FICC (fixed income, commodity, and currency) revenue could double in Q1 from Q4.

The financial services industry may be seeing massive job cuts, but leading brokerage houses are still aggressively recruiting brokers working for rivals. Merrill Lynch (BAC) is offering top brokers from rival firms upfront cash payments equal to 150% of the fees and commissions they generated over the prior 12 months, while UBS has raised its payment to 180%.